Item 1.01 Entry into a Material Definitive Agreement.

As previously disclosed, on July 23, 2020, Ascena Retail Group, Inc. (the "Company") and certain of its subsidiaries (together with the Company, the "Debtors") filed voluntary petitions (the "Chapter 11 Cases") under chapter 11 of title 11 of the United States Code (the "Bankruptcy Code") in the United States Bankruptcy Court for the Eastern District of Virginia (the "Bankruptcy Court").

Also as previously disclosed, on July 23, 2020, prior to the commencement of the Chapter 11 Cases, the Company entered into a backstop commitment letter (which was amended on September 9, 2020) with certain of the Company's creditors and/or their affiliates (the "Backstop Parties"), pursuant to which the Backstop Parties committed to provide the Company with a superpriority senior secured debtor-in-possession term loan credit facility in an aggregate amount equal to approximately $312.3 million (the "DIP Term Facility"), on the terms and conditions set forth therein, including the approval of the Bankruptcy Court.

In addition, as previously disclosed, on August 14, 2020, the Company entered into a commitment letter (the "DIP ABL Commitment Letter") with certain lenders (the "DIP ABL Lenders") under the Amended and Restated Credit Agreement, dated as of January 3, 2011, as further amended and restated as of February 27, 2018 (as amended, restated, supplemented or otherwise modified from time to time, the "Prepetition ABL Credit Agreement"), among the Company, certain of the Company's subsidiaries party thereto as borrowing subsidiaries, the other loan parties party thereto, the lenders party thereto, the issuing banks party thereto and JPMorgan Chase Bank, N.A., as administrative agent. Pursuant to the DIP ABL Commitment Letter, and on the terms and conditions set forth therein, including the approval of the Bankruptcy Court, the DIP ABL Lenders committed to provide the Company with a superpriority senior secured debtor-in-possession asset based revolving credit facility in an aggregate amount of up to $400 million (the "DIP ABL Facility" and, together with the DIP Term Facility, the "DIP Facilities"), pursuant to which the commitments and loans of the lenders party to the Prepetition ABL Credit Agreement would convert into the DIP ABL Facility.

In connection with the Chapter 11 Cases, the Debtors filed a motion for approval of the DIP Facilities [Docket No. 18], and on September 10, 2020, the Bankruptcy Court approved such motion and entered an order approving the DIP Facilities and use of cash collateral on a final basis [Docket No. 587] (the "DIP Order").





DIP Term Credit Agreement

In accordance with the DIP Order, on September 16, 2020, the Company and AnnTaylor Retail, Inc., as borrowers (collectively, the "DIP Term Borrowers"), entered into a Senior Secured Super-Priority Debtor-in-Possession Term Credit Agreement (the "DIP Term Credit Agreement") with the lenders party thereto (the "DIP Term Lenders") and Alter Domus (US) LLC, as administrative agent. Capitalized terms used but not otherwise defined in this "DIP Term Credit Agreement" section of this Current Report on Form 8-K have the meanings given to them in the DIP Term Credit Agreement. The DIP Term Borrowers' obligations under the DIP Credit Agreement are secured by substantially all of the real and personal property of the DIP Term Borrowers and each subsidiary of the Company that are guarantors (collectively, the "DIP Term Loan Parties"), subject to certain exceptions.

The DIP Term Facility, which is governed by the DIP Term Credit Agreement, consists of (i) $150.0 million in new money term loans (the "New Money DIP Loans") and (ii) $162.3 million of certain prepetition term loan obligations that have been rolled into the DIP Term Facility. The proceeds of the New Money DIP Loans may be used, among other things, to pay certain costs, fees and expenses related to the Chapter 11 Cases and to prepay or repay up to $50.0 million of borrowings under the ABL Credit Agreement, in all cases, subject to the terms of the DIP Term Credit Agreement.

Upon the satisfaction of certain conditions set forth in the exit facility term sheet attached to the DIP Term Credit Agreement, including the Effective Date having occurred, the DIP Term Facility will convert on a dollar-for-dollar basis into first out term loans (the "First Out Exit Term Facility") and certain prepetition term lenders, including the DIP Term Lenders, will provide the Company with $87.7 million of last out term loans (the "Last Out Exit Term Facility" and, together with the First Out Exit Term Facility, the "Exit Term Facility").

The maturity date of the DIP Term Facility is the date that is the earliest of (i) six months after the Effective Date, (ii) the date of the substantial consummation (as defined in section 1101(2) of the Bankruptcy Code) of an Acceptable Plan, (iii) the date the Bankruptcy Court converts any of the Chapter 11 Cases to a case under chapter 7 of the Bankruptcy Code, (iv) the date the Bankruptcy Court dismisses any of the Chapter 11 Cases, (v) the date on which the DIP Term Loan Parties consummate a sale of all or substantially all of the assets of the DIP Term Loan Parties pursuant to section 363 of the Bankruptcy Code or otherwise, and (vi) such earlier date on which the loans made under the DIP Term Credit Agreement become due and payable by acceleration or otherwise in accordance with the terms of the DIP Term Credit Agreement and the other Loan Documents.

Loans under the DIP Term Facility bear interest at a rate per annum equal to (i) in the case of a base rate loan, the base rate (which is subject to a floor of 2.00%) plus 10.75% or (ii) in the case of a Eurodollar rate loan, the adjusted London interbank offering rate (which is subject to a floor of 1.00%) plus 11.75%. Upon the occurrence and during the continuance of an event of default under the DIP Term Facility, the Company will be subject to a default rate of interest equal to 2.00% above the rate otherwise applicable.

Loans under the First Out Exit Term Facility will bear interest at a rate per annum equal to (i) in the case of a base rate loan, the base rate plus 10.75% or (ii) in the case of a Eurodollar rate loan, the adjusted London interbank offering rate (which is subject to a floor of 1.00%) plus 11.75%. Loans under the Last Out Exit Term Facility will bear interest at a rate per annum equal to (a) prior to the second anniversary of the Effective Date, (1) in the case of a base rate loan, the base rate plus 2.00% in cash and 8.00% in kind or (2) in the case of a Eurodollar rate loan, the adjusted London interbank offering rate (which is subject to a floor of 1.00%) plus 2.50% in cash and 8.50% in kind and (b) thereafter, (I) in the case of a base rate loan, the base rate plus 10.00% in cash or (II) in the case of a Eurodollar rate loan, the adjusted London interbank offering rate (which is subject to a floor of 1.00%) plus 11.00% in cash. If any principal of or interest on any loan or any fee or other amount payable under the Exit Term Facility is not paid when due, such overdue amount will be subject to a default rate of interest equal to 2.00% above the rate otherwise applicable. . . .

Item 2.03 Creation of a Direct Financial Obligation or Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information set forth in Item 1.01 regarding the DIP Term Facility, the DIP Term Credit Agreement, the DIP ABL Facility and the DIP ABL Credit Agreement is incorporated by reference into this Item 2.03.

Item 7.01 Regulation FD Disclosure.

On September 21, 2020, the Company issued a press release providing an update on the Chapter 11 Cases, including entry into the DIP Term Credit Agreement and the DIP ABL Credit Agreement.

A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K. The information furnished pursuant to this Item 7.01, including Exhibit 99.1, shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and it shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits.





(d) Exhibits.



Exhibit Number   Description

  10.1*            Senior Secured Super-Priority Debtor-in-Possession Term Credit
                 Agreement, dated as of September 16, 2020, by and among Ascena
                 Retail Group, Inc., AnnTaylor Retail, Inc., the lenders party
                 thereto and Alter Domus (US) LLC, as administrative agent.
  10.2*            Senior Secured Super-Priority Debtor-in-Possession Credit
                 Agreement, dated as of September 16, 2020, by and among Ascena
                 Retail Group, Inc., the borrowing subsidiaries party thereto, the
                 other loan parties party thereto, the lenders party thereto and
                 JPMorgan Chase Bank, N.A., as administrative agent.
  99.1             Press Release issued September 21, 2020.
104              Cover Page Interactive Data File. The cover page XBRL tags are
                 embedded within the inline XBRL document (contained in Exhibit 101).

* Certain schedules and similar attachments have been omitted. The Company agrees to furnish a supplemental copy of any omitted schedule or attachment to the Securities and Exchange Commission upon request.

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